Malaysia's cost of living keeps climbing

KUALA LUMPUR- Political scientist Wong Chin Huat had a shocking start to the year when his bill from the laundry came back 20 per cent higher than usual.

The business had raised its ironing charges from RM1 (38 Singapore cents) to RM1.20 a shirt, due to the hike in Malaysia's electricity tariff that took effect on Jan 1.

The bill gave him a jolt, even though Dr Wong, a fellow at the Penang Institute, had expected prices to go up soon after the government began rolling back subsidies last September.

"Businesses will pass on the cost, or just jump on the bandwagon, especially if they think that costs will go up further this year," he said, adding that this was only the beginning.

From electricity and petrol to food, many Malaysians complain that the cost of living is steadily climbing. Economists warn that inflation - now under 3 per cent - will be a serious challenge this year as the subsidy rationalisation programme hits the pocket.

From hawker stalls in Penang to coffee shops in Petaling Jaya, Selangor, businesses have raised prices by about 20 per cent, The Star reported yesterday.

With public unhappiness mounting, thousands of Malaysians wearing black swarmed Independence Square on New Year's Eve to protest against price hikes that ensued from subsidy cuts.

Fuel subsidies were first to be cut, resulting in petrol prices rising from RM1.90 to RM2.10 a litre last September. This was followed by the lifting of subsidies for sugar, now at RM2.80 a kg from RM2.50 last October.